What changed in this filing

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Item 1. Financial Statements

2022-05-04 compared with 2021-10-29 · 125 added, 202 removed, 387 unchanged (46% of the section changed)

3 unchanged sentences

(in thousands, except share amounts)

September 30,

2022 December 31, 2021

14 unchanged sentences

Income taxes payable 38,608 15,631

Notes payable 62 239

Current operating lease liabilities 86,279 83,787

21 unchanged sentences

Three Months Ended

September 30, Nine Months Ended

September 30,

2021 2020 2021 2020

Service revenues $ 1,814,834 $ 1,398,380

21 unchanged sentences

Three Months Ended

September 30, Nine Months Ended

September 30,

2021 2020 2021 2020

COMPREHENSIVE INCOME (LOSS):

23 unchanged sentences

110,747 $ 111 $ 1,251,086 $ ( 23,574 ) $ 225,145 $ 1,452,768

Net income — — — — 149,213 149,213

Other comprehensive income (loss) — — — 4,437 — 4,437

Dividends declared ($ .38 per share)

— — — — ( 42,720 ) ( 42,720 )

Net issuances of restricted stock 5 — — — — —

Stock-based compensation — — 13,903 — — 13,903

Repurchases of common stock ( 717 ) ( 1 ) — — ( 63,281 ) ( 63,282 )

Balance at June 30, 2021 111,970 $ 112 $ 1,208,056 $ ( 9,092 ) $ 60,174 $ 1,259,250

Net income — — — — 170,871 170,871

Other comprehensive income (loss) — — — ( 10,008 ) — ( 10,008 )

Dividends declared ($ .38 per share)

— — — — ( 42,463 ) ( 42,463 )

Net issuances of restricted stock 1 — — — — —

Stock-based compensation — — 14,061 — — 14,061

Repurchases of common stock ( 742 ) ( 1 ) — — ( 75,667 ) ( 75,668 )

Balance at September 30, 2021

111,229 $ 111 $ 1,222,117 $ ( 19,100 ) $ 112,915 $ 1,316,043

The accompanying Notes to Condensed Consolidated Financial Statements (Unaudited)

are an integral part of these financial statements.

ROBERT HALF INTERNATIONAL INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (UNAUDITED)-(Continued)

(in thousands, except per share amounts)

Common Stock Additional Paid-In Capital Accumulated Other Comprehensive Income (Loss) Retained Earnings Total

2 unchanged sentences

Net income — — — — 110,598 110,598

Adoption of accounting pronouncement — — — — ( 558 ) ( 558 )

Other comprehensive income (loss) — — — ( 8,797 ) — ( 8,797 )

5 unchanged sentences

Balance at March 31, 2021 112,682 $ 113 $ 1,194,153 $ ( 13,529 ) $ 16,962 $ 1,197,699

Net income — — — — 46,196 46,196

Other comprehensive income (loss) — — — 6,534 — 6,534

Dividends declared ($ .34 per share)

— — — — ( 38,975 ) ( 38,975 )

Net issuances of restricted stock 33 — — — — —

Stock-based compensation — — 13,035 — — 13,035

Repurchases of common stock 0 0 — — ( 9 ) ( 9 )

Balance at June 30, 2020 114,635 $ 115 $ 1,154,046 $ ( 27,152 ) $ 29,697 $ 1,156,706

Net income — — — — 75,749 75,749

Other comprehensive income (loss) — — — 11,156 — 11,156

Dividends declared ($ .34 per share)

— — — — ( 38,969 ) ( 38,969 )

Net issuances of restricted stock ( 2 ) — — — — —

Stock-based compensation — — 13,063 — — 13,063

Repurchases of common stock ( 453 ) ( 1 ) — — ( 23,675 ) ( 23,676 )

Balance at September 30, 2020 114,180 $ 114 $ 1,167,109 $ ( 15,996 ) $ 42,802 $ 1,194,029

The accompanying Notes to Condensed Consolidated Financial Statements (Unaudited)

3 unchanged sentences

(in thousands)

Nine Months Ended

September 30,

Three Months Ended

CASH FLOWS FROM OPERATING ACTIVITIES:

5 unchanged sentences

Amortization of intangible assets 417 576

Realized and unrealized gains from investments held in employee deferred

Realized and unrealized (gains) losses from investments held in employee deferred

compensation trusts

33 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

September 30, 2021

March 31, 2022

Note A— Summary of Significant Accounting Policies

1 unchanged sentence

Robert Half International Inc.

(the “Company”) provides specialized staffing and risk consulting services through such divisions as Accountemps ® , Robert Half ® Finance & Accounting , OfficeTeam ® , Robert Half ® Technology , Robert Half ® Management Resources , Robert Half ® Legal , The Creative Group ® , and Protiviti ® .

The Company, through its Accountemps , Robert Half Finance & Accounting , and Robert Half Management Resources divisions, is a specialized provider of contract, full-time, and senior-level project professionals in the fields of accounting and finance.

OfficeTeam specializes in highly skilled contract, administrative support professionals.

Robert Half Technology provides project and full-time technology professionals.

Robert Half Legal provides contract, project, and full-time staffing of lawyers, paralegals and legal support personnel.

The Creative Group provides creative, digital, marketing, advertising and public relations professionals.

Protiviti is a global consulting firm that helps companies solve problems in finance, technology, operations, data, analytics, governance, risk and internal audit, and is a wholly-owned subsidiary of the Company.

Revenues are predominantly derived from specialized staffing services.

(the “Company”) is a specialized talent solutions and business consulting firm that connects opportunities at great companies with highly skilled job seekers.

Robert Half® offers contract talent solutions and permanent placement talent solutions for finance and accounting, technology, marketing and creative, legal, administrative and customer support roles.

Robert Half is also the parent company of Protiviti® , a global consulting firm that provides internal audit, risk, business, and technology consulting solutions.

The Company recently completed a multiyear process to unify its family of Robert Half endorsed divisional brands to a single brand, Robert Half .

This simplifies the Company's go-to-market brand structure for clients and candidates and provides leverage for greater brand awareness and allows future flexibility to expand the Company's existing functional specializations.

In connection with this process, the Company's current financial statement disclosures reflect new names for its reportable segments, including contract talent solutions (formerly temporary and consultant staffing), permanent placement talent solutions (formerly permanent placement staffing) and Protiviti (formerly risk consulting and internal audit services).

What was previously referred to as staffing operations is now referred to as talent solutions.

The presentation of contract talent solutions includes functional specializations rather than the previously branded divisions.

The functional specializations are:

finance and accounting, which combines the former Accountemps® and Robert Half® Management Resources divisions;

administrative and customer support, which consists of the former OfficeTeam® ;

and technology, which includes the former Robert Half® Technology .

The Company operates in North America, South America, Europe, Asia and Australia.

12 unchanged sentences

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

As of September 30, 2021, such estimates include allowances for credit losses, variable consideration, workers’ compensation losses, income and other taxes, and assumptions used in the Company’s goodwill impairment assessment and in the valuation of stock grants subject to market conditions.

As of March 31, 2022, such estimates include allowances for credit losses, variable consideration, workers’ compensation losses, accrued medical expenses, income and other taxes, assumptions used in the Company’s goodwill impairment assessment and in the valuation of stock grants subject to market conditions.

We continue to monitor the global economic uncertainty as a result of coronavirus (“COVID-19”) to assess the impact on the Company’s results of operations, financial condition, and liquidity.

2 unchanged sentences

The Company derives its revenues from three segments:

temporary and consultant staffing, permanent placement staffing, and risk consulting and internal audit services.

contract talent solutions, permanent placement talent solutions, and Protiviti.

Revenues are recognized when promised goods or services are delivered to customers in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services.

See Note C for further discussion of the revenue recognition accounting policy.

Costs of Services.

Direct costs of temporary and consultant staffing consist of payroll, payroll taxes and benefit costs for the Company’s engagement professionals, as well as reimbursable expenses.

Direct costs of permanent placement staffing services consist of reimbursable expenses.

Risk consulting and internal audit direct costs of services include professional staff payroll, contract labor payroll, payroll taxes and benefit costs, as well as reimbursable expenses.

ROBERT HALF INTERNATIONAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)—(Continued)

September 30, 2021

March 31, 2022

Costs of Services.

Direct costs of contract talent solutions consist of professional staff payroll, payroll taxes and benefit costs for the Company’s engagement professionals, as well as reimbursable expenses.

Direct costs of permanent placement talent solutions consist of reimbursable expenses.

Protiviti direct costs of services include professional staff payroll, payroll taxes and benefit costs, as well as reimbursable expenses.

Advertising Costs.

The Company expenses all advertising costs as incurred .

Advertising costs were $ 13.9 million and $ 34.1 million for the three and nine months ended September 30, 2021, respectively, and $ 7.7 million and $ 28.9 million for the three and nine months ended September 30, 2020, respectively.

Advertising costs were $ 14.2 million and $ 8.4 million for the three months ended March 31, 2022 and 2021, respectively.

(Income) Loss from Investments Held in Employee Deferred Compensation Trusts .

1 unchanged sentence

As realized and unrealized investment gains and losses occur, the Company’s deferred compensation obligation to employees changes accordingly.

Changes in the Company’s deferred compensation obligations remain in selling, general and administrative expenses or, in the case of risk consulting and internal audit services, costs of services.

Changes in the Company’s deferred compensation obligations remain in selling, general and administrative expenses or, in the case of Protiviti, costs of services.

The value of the related investment trust assets also changes by an equal and offsetting amount, leaving no net cost to the Company.

The Company’s income from investments held in employee deferred compensation trusts consists primarily of unrealized and realized gains and losses and dividend income from trust investments.

The Company’s (income) loss from investments held in employee deferred compensation trusts consists primarily of unrealized and realized gains and losses and dividend income from trust investments.

The following table presents the Company’s (income) loss from investments held in employee deferred compensation trusts (in thousands):

Three Months Ended

September 30, Nine Months Ended

September 30,

2021 2020 2021 2020

Dividend income $ ( 295 ) $ ( 294 )

14 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)—(Continued)

September 30, 2021

March 31, 2022

The following table sets forth the composition of the underlying assets which comprise the Company’s deferred compensation trust assets (in thousands):

Fair Value Measurements Using

Balance at September 30, 2021

Balance at March 31, 2022

Quoted Prices

21 unchanged sentences

The Company is exposed to credit losses resulting from the inability of its customers to make required payments.

The Company establishes an allowance for these potential credit losses based on its review of customers’ credit profiles, historical loss statistics, prepayments, recoveries, current business conditions and macro-economic trends.

The Company considers risk characteristics of trade receivables based on asset type, size, term, and geographical locations to evaluate trade receivables on a collective basis.

The Company establishes an allowance for these potential credit losses based on its review of customers’ credit profiles, historical loss statistics, prepayments, recoveries, age of customer receivable balances, current business conditions and macro-economic trends.

The Company considers risk characteristics of trade receivables based on asset type and geographical locations to evaluate trade receivables on a collective basis.

The Company applies credit loss estimates to these pooled receivables to determine expected credit losses.

1 unchanged sentence

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)—(Continued)

September 30, 2021

The following table sets forth the activity in the allowance for credit losses from January 1, 2020, through September 30, 2021 (in thousands):

March 31, 2022

The following table sets forth the activity in the allowance for credit losses from December 31, 2021 through March 31, 2022 (in thousands):

Allowance for Credit Losses

Balance as of January 1, 2020

Charges to expense 4,200

Deductions ( 7,906 )

Other, including translation adjustments ( 120 )

Balance as of December 31, 2021

2 unchanged sentences

Other, including translation adjustments ( 123 )

Balance as of September 30, 2021

Internal-use Software.

The Company capitalizes direct costs incurred in the development of internal-use software.

Cloud computing implementation costs incurred in hosting arrangements are capitalized and reported as a component of other current assets.

All other internal-use software development costs are capitalized and reported as a component of computer software within property and equipment on the unaudited Condensed Consolidated Statements of Financial Position.

Capitalized internal-use software development costs were $ 9.5 million and $ 29.0 million for the three and nine months ended September 30, 2021, respectively, and $ 8.8 million and $ 31.7 million for the three and nine months ended September 30, 2020, respectively.

Goodwill and Intangible Assets .

Goodwill and intangible assets primarily consist of the cost of acquired companies in excess of the fair market value of their net tangible assets at the date of acquisition.

Identifiable intangible assets are amortized over their lives, typically ranging from two to five years .

Goodwill is not amortized, but is assessed at least annually for impairment, or on an as needed interim basis.

Balance as of March 31, 2022

Note B— New Accounting Pronouncements

Recently Adopted Accounting Pronouncements

Government Assistance.

In November 2021, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2021-10, "Government Assistance (Topic 832):

Disclosures by Business Entities about Government Assistance" to increase the transparency of government assistance including the disclosure of the types of assistance an entity receives, an entity’s method of accounting for government assistance and the effect of the assistance on an entity’s financial statements.

This standard is effective for annual periods beginning after December 15, 2021.

The amendments should be applied either (1) prospectively to all transactions within the scope of the amendments that are reflected in financial statements at the date of initial application and new transactions that are entered into after the date of initial application, or (2) retrospectively to those transactions.

The Company adopted this ASU in January 2022.

The adoption of this guidance did not have a material impact on its financial statements.

Recently Issued Accounting Pronouncements Not Yet Adopted

1 unchanged sentence

The Company derives its revenues from three segments:

temporary and consultant staffing, permanent placement staffing, and risk consulting and internal audit services.

contract talent solutions, permanent placement talent solutions, and Protiviti.

1 unchanged sentence

Reimbursements, including those related to travel and out-of-pocket expenses, are also included in service revenues, and equivalent amounts of reimbursable expenses are included in costs of services.

Temporary and consultant staffing revenues.

Temporary and consultant staffing revenues from contracts with customers are recognized in the amount to which the Company has a right to invoice, when the services are rendered by the Company’s engagement professionals.

Contract talent solutions revenues.

Contract talent solutions revenues are recognized in the amount to which the Company has a right to invoice when the services are rendered by the Company’s engagement professionals.

The substantial majority of engagement professionals placed on assignment by the Company are the Company’s legal employees while they are working on assignments.

The Company pays all related costs of employment,

ROBERT HALF INTERNATIONAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)—(Continued)

September 30, 2021

including workers’ compensation insurance, state and federal unemployment taxes, social security and certain fringe benefits.

The Company pays all related costs of employment, including workers’ compensation insurance, state and federal unemployment taxes, social security, and certain fringe benefits.

The Company assumes the risk of acceptability of its employees to its customers.

The Company records temporary and consultant staffing revenue on a gross basis as a principal versus on a net basis as an agent in the presentation of revenues and expenses.

The Company records contract talent solutions revenues on a gross basis as a principal versus on a net basis as an agent in the presentation of revenues and expenses.

The Company has concluded that gross reporting is appropriate because the Company (i) has the risk of identifying and hiring qualified employees, (ii) has the discretion to select the employees and establish their price and duties, and (iii) bears the risk for services that are not fully paid for by customers.

Fees paid to Time Management or Vendor Management service providers selected by clients are recorded as a reduction of revenues, as the Company is not the primary obligor with respect to those services.

Permanent placement staffing revenues.

Permanent placement staffing revenues from contracts with customers are primarily recognized when employment candidates accept offers of permanent employment.

ROBERT HALF INTERNATIONAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)—(Continued)

March 31, 2022

Permanent placement talent solutions revenues.

Permanent placement talent solutions revenues are primarily recognized when employment candidates accept offers of permanent employment.

The Company has a substantial history of estimating the financial impact of permanent placement candidates who do not remain with its clients through the 90 -day guarantee period.

1 unchanged sentence

Fees to clients are generally calculated as a percentage of the new employee’s annual compensation.

No fees for permanent placement services are charged to employment candidates.

Risk consulting and internal audit services revenues.

Risk consulting and internal audit services are generally provided on a time-and-material basis or fixed-fee basis.

No fees for permanent placement talent solution services are charged to employment candidates.

Protiviti revenues.

Protiviti's consulting services are generally provided on a time-and-material basis or fixed-fee basis.

Revenues earned under time-and-material arrangements and fixed-fee arrangements are recognized using a proportional performance method.

1 unchanged sentence

Cost incurred represents work performed and thereby best depicts the transfer of control to the customer.

Risk consulting and internal audit services generally contain one or more performance obligation(s) which are satisfied over a period of time.

Protiviti's consulting services generally contain one or more performance obligation(s) which are satisfied over a period of time.

Revenues are recognized over time as the performance obligations are satisfied because the services provided do not have any alternative use to the Company and contracts generally include language giving the Company an enforceable right to payment for services provided to date.

The Company periodically evaluates the need to provide for any losses on these projects, and losses are recognized when it is probable that a loss will be incurred.

The following table presents the Company’s service revenues disaggregated by line of business (in thousands):

The following table presents the Company’s service revenues disaggregated by functional specialization and segment (in thousands):

Three Months Ended

September 30, Nine Months Ended

September 30,

2021 2020 2021 2020

Accountemps $ 492,558 $ 351,598 $ 1,363,007 $ 1,173,024

OfficeTeam 279,370 173,685 763,035 549,963

Robert Half Technology 215,500 161,007 581,905 519,687

Robert Half Management Resources 239,807 154,917 633,685 531,826

Contract talent solutions

Finance and accounting $ 801,690 $ 600,387

Administrative and customer support 284,906 220,467

Technology 213,327 172,239

Elimination of intersegment revenues (a) ( 144,200 ) ( 103,818 )

Temporary and consultant staffing 1,054,701 781,391 2,922,257 2,626,897

Permanent placement staffing 156,444 87,203 411,788 278,722

Risk consulting and internal audit services 501,421 321,303 1,357,482 899,295

Service revenues $ 1,712,566 $ 1,189,897 $ 4,691,527 $ 3,804,914

(a) Service revenues for Accountemps, OfficeTeam, Robert Half Technology and Robert Half Management Resources include intersegment revenues, which represent revenues from services provided to the Company’s risk consulting and internal audit services segment in connection with the Company’s blended business solutions.

Intersegment revenues for each line of business are aggregated and then eliminated as a single line.

ROBERT HALF INTERNATIONAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)—(Continued)

September 30, 2021

Total contract talent solutions 1,155,723 889,275

Permanent placement talent solutions 186,782 111,703

Protiviti 472,329 397,402

Total service revenues $ 1,814,834 $ 1,398,380

(a) Service revenues for finance and accounting, administrative and customer support, and technology include intersegment revenues, which represent revenues from services provided to the Company’s Protiviti segment in connection with the Company’s blended business solutions.

Intersegment revenues for each functional specialization are aggregated and then eliminated as a single line.

Payment terms in the Company’s contracts vary by the type of the Company’s customer and the services offered.

1 unchanged sentence

Contracts with multiple performance obligations are recognized as performance obligations are delivered, and contract value is allocated based on relative stand-alone selling values of the services and products in the arrangement.

As of September 30, 2021, aggregate transaction price allocated to the performance obligations that are unsatisfied for contracts with an expected duration of greater than one year was $ 135.4 million.

As of March 31, 2022, aggregate transaction price allocated to the performance obligations that were unsatisfied for contracts with an expected duration of greater than one year was $ 147.7 million.

Of this amount, $ 133.6 million is expected to be recognized within the next twelve months .

As of September 30, 2020, aggregate transaction price allocated to the performance obligations that are unsatisfied for contracts with an expected duration of greater than one year was $ 108.2 million.

As of March 31, 2021, aggregate transaction price allocated to the performance obligations that were unsatisfied for contracts with an expected duration of greater than one year was $ 170.0 million.

ROBERT HALF INTERNATIONAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)—(Continued)

March 31, 2022

Contract liabilities are recorded when cash payments are received or due in advance of performance and are reflected in accounts payable and accrued expenses on the unaudited Condensed Consolidated Statements of Financial Position.

The following table sets forth the activity in contract liabilities from January 1, 2020, through September 30, 2021 (in thousands):

The following table sets forth the activity in contract liabilities from December 31, 2021 through March 31, 2022 (in thousands):

Contract Liabilities

Balance as of January 1, 2020 $ 12,948

Payments in advance of satisfaction of performance obligations 25,614

Revenue recognized ( 20,687 )

Other, including translation adjustments 377

Balance as of December 31, 2021 $ 25,601

2 unchanged sentences

Other, including translation adjustments ( 278 )

Balance as of September 30, 2021

Balance as of March 31, 2022

Note D— Other Current Assets

Other current assets consisted of the following (in thousands):

September 30,

2022 December 31, 2021

Prepaid expenses $ 83,906 $ 69,526

Unamortized cloud computing implementation costs 47,040 44,692

Other 42,327 55,646

2 unchanged sentences

Property and equipment consisted of the following (in thousands):

September 30,

2022 December 31, 2021

8 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)—(Continued)

September 30, 2021

March 31, 2022

Note F— Leases

1 unchanged sentence

The Company’s leases have remaining lease terms of less than 1 year to 8 years, some of which include options to extend the leases for up to 10 years, and some of which include options to terminate the leases within 1 year.

Operating lease expenses were $ 21.6 million and $ 64.8 million for the three and nine months ended September 30, 2021, respectively, and $ 20.6 million and $ 60.5 million for the three and nine months ended September 30, 2020, respectively.

Operating lease expenses were $ 22.6 million and $ 21.5 million for the three months ended March 31, 2022 and 2021, respectively.

Supplemental cash flow information related to leases consisted of the following (in thousands):

Nine Months Ended

September 30,

Three Months Ended

Cash paid for operating lease liabilities $ 22,986 $ 22,225

4 unchanged sentences

Supplemental balance sheet information related to leases consisted of the following:

September 30,

2022 December 31,

1 unchanged sentence

Weighted average discount rate for operating leases 2.3 % 2.3 %

Future minimum lease payments under non-cancellable leases as of September 30, 2021 were as follows (in thousands):

2021 (excluding the nine months ended September 30, 2021)

Future minimum lease payments under non-cancellable leases as of March 31, 2022 were as follows (in thousands):

2022 (excluding the three months ended March 31, 2022)

Thereafter 14,247

2 unchanged sentences

(a) Includes current portion of $ 86.3 million for operating leases.

As of September 30, 2021, the Company had additional future minimum lease obligations totaling $ 5.0 million under operating leases that had not yet commenced.

As of March 31, 2022, the Company had additional future minimum lease obligations totaling $ 6.0 million under executed operating lease contracts that had not yet commenced.

These operating leases include agreements for corporate and field office facilities with lease terms of 1 to 6 years.

1 unchanged sentence

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)—(Continued)

September 30, 2021

March 31, 2022

Note G— Goodwill

The following table sets forth the activity in goodwill from December 31, 2020 through September 30, 2021 (in thousands):

Temporary and consultant staffing Permanent placement staffing Risk consulting and internal audit services Total

The following table sets forth the activity in goodwill from December 31, 2021 through March 31, 2022 (in thousands):

Contract talent solutions Permanent placement talent solutions Protiviti Total

Balance as of December 31, 2021

1 unchanged sentence

Foreign currency translation adjustments ( 61 ) ( 12 ) 76 3

Balance as of September 30, 2021

Balance as of March 31, 2022

$ 134,523 $ 26,177 $ 62,158 $ 222,858

1 unchanged sentence

Accrued payroll and benefit costs consisted of the following (in thousands):

September 30,

2022 December 31, 2021

3 unchanged sentences

Accrued payroll and benefit costs $ 499,810 $ 540,183

The Company, under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, deferred paying $ 102.2 million of applicable payroll taxes as of September 30, 2021, of which $ 51.1 million is expected to be paid during the next 12 months and is included in accrued payroll and benefit costs and the remaining $ 51.1 million is included in other liabilities on the unaudited Condensed Consolidated Statements of Financial Position.

Deferred payroll taxes payable was $ 102.2 million as of December 31, 2020.

The Company, under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, deferred paying $ 51.1 million of applicable payroll taxes as of both March 31, 2022 and December 31, 2021, which is expected to be paid during the next 12 months and is included in payroll taxes .

Note I— Employee Deferred Compensation Plan Obligations

2 unchanged sentences

Assets of this plan are held by an independent trustee for the sole benefit of participating employees.

Nonqualified plans are provided for employees not eligible for the qualified plans.

These plans include provisions for salary deferrals and Company matching and discretionary contributions.

The asset value of the nonqualified plans was $ 462.3 million and $ 406.6 million as of September 30, 2021 and December 31, 2020, respectively.

Nonqualified plans are provided for employees on a discretionary basis, including those not eligible for the qualified plans.

These plans include provisions for salary deferrals and discretionary contributions.

The asset value of the nonqualified plans was $ 476.8 million and $ 495.0 million as of March 31, 2022 and December 31, 2021, respectively.

The Company holds these assets to satisfy the Company’s liabilities under its deferred compensation plans.

The liability value for the nonqualified plans was $ 492.1 million and $ 435.1 million as of September 30, 2021 and December 31, 2020, respectively.

ROBERT HALF INTERNATIONAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)—(Continued)

September 30, 2021

The liability value for the nonqualified plans was $ 495.3 million and $ 535.3 million as of March 31, 2022 and December 31, 2021, respectively.

The following table presents the Company’s compensation expense related to its qualified defined contribution plans and nonqualified plans (in thousands):

Three Months Ended

September 30, Nine Months Ended

September 30,

2021 2020 2021 2020

Contribution expense $ 12,202 $ 9,554

2 unchanged sentences

The Company has statutory defined contribution plans and defined benefit plans outside the U.S., which are not material.

ROBERT HALF INTERNATIONAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)—(Continued)

March 31, 2022

Note J— Commitments and Contingencies

20 unchanged sentences

Legal costs associated with the resolution of claims, lawsuits and other contingencies are expensed as incurred.

ROBERT HALF INTERNATIONAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)—(Continued)

September 30, 2021

In May 2021, the Company entered into an amendment to extend the maturity of its $ 100 million unsecured revolving credit facility (the “Credit Agreement”) to May 2024.

Borrowings under the Credit Agreement will bear interest in accordance with the terms of the borrowing, which typically will be calculated according to the LIBOR, or an alternative base rate, plus an applicable margin.

The Credit Agreement is subject to certain financial covenants and the Company was in compliance with these covenants as of September 30, 2021.

There were no borrowings under the Credit Agreement as of September 30, 2021.

The Credit Agreement is subject to certain financial covenants and the Company was in compliance with these covenants as of March 31, 2022.

There were no borrowings under the Credit Agreement as of March 31, 2022.

ROBERT HALF INTERNATIONAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)—(Continued)

March 31, 2022

Note K— Stockholders’ Equity

Stock Repurchase Program.

As of September 30, 2021, the Company is authorized to repurchase, from time to time, up to 7.7 million additional shares of the Company’s common stock on the open market or in privately negotiated transactions, depending on market conditions.

The number and the cost of common stock shares repurchased during the nine months ended September 30, 2021 and 2020 are reflected in the following table (in thousands):

Nine Months Ended

September 30,

As of March 31, 2022, the Company is authorized to repurchase, from time to time, up to 6.7 million additional shares of the Company’s common stock on the open market or in privately negotiated transactions, depending on market conditions.

The number and the cost of common stock shares repurchased during the three months ended March 31, 2022 and 2021 are reflected in the following table (in thousands):

Three Months Ended

Common stock repurchased (in shares) 475 797

1 unchanged sentence

Additional stock repurchases were made in connection with employee stock plans, whereby Company shares were tendered by employees for the payment of applicable statutory withholding taxes.

The number and the cost of repurchases related to employee stock plans made during the nine months ended September 30, 2021 and 2020 are reflected in the following table (in thousands):

Nine Months Ended

September 30,

The number and the cost of employee stock plan repurchases made during the three months ended March 31, 2022 and 2021 are reflected in the following table (in thousands):

Three Months Ended

Repurchases related to employee stock plans (in shares) 62 251

2 unchanged sentences

Treasury stock is accounted for using the cost method.

Repurchase activity for the three and nine months ended September 30, 2021 and 2020 is presented in the unaudited Condensed Consolidated Statements of Stockholders’ Equity.

Treasury stock activity for the three months ended March 31, 2022 and 2021 (consisting of purchase of shares for the treasury) is presented in the unaudited Condensed Consolidated Statements of Stockholders’ Equity.

Repurchases of shares and issuances of dividends are applied first to the extent of retained earnings and any remaining amounts are applied to additional paid-in capital.

ROBERT HALF INTERNATIONAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)—(Continued)

September 30, 2021

Note L— Net Income Per Share

The calculation of net income per share for the three and nine months ended September 30, 2021 and 2020 is reflected in the following table (in thousands, except per share amounts):

The calculation of net income per share for the three months ended March 31, 2022 and 2021 is reflected in the following table (in thousands, except per share amounts):

Three Months Ended

September 30, Nine Months Ended

September 30,

2021 2020 2021 2020

Net income $ 168,239 $ 110,598

8 unchanged sentences

Diluted $ 1.52 $ .98

ROBERT HALF INTERNATIONAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)—(Continued)

March 31, 2022

Note M— Business Segments

The Company has three reportable segments:

temporary and consultant staffing, permanent placement staffing, and risk consulting and internal audit services.

contract talent solutions, permanent placement talent solutions, and Protiviti.

Operating segments are defined as components of the Company for which separate financial information is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and assess performance.

The temporary and consultant staffing segment provides specialized staffing in the accounting and finance, administrative and office, information technology, legal, advertising, marketing and web design fields.

The permanent placement staffing segment provides full-time personnel in the accounting, finance, administrative and office, and information technology fields.

The risk consulting and internal audit services segment provides business and technology risk consulting and internal audit services.

The contract talent solutions segment provides specialized engagement professionals in the accounting and finance, administrative and office, information technology, legal, advertising, marketing and web design fields.

The permanent placement talent solutions segment provides full-time personnel in the accounting, finance, administrative and office, legal, and information technology fields.

The Protiviti segment provides business and technology risk consulting and internal audit services.

The accounting policies of the segments are set forth in Note A—“Summary of Significant Accounting Policies” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.

The Company evaluates performance based on income before net interest income, intangible assets amortization expense, and income taxes.

ROBERT HALF INTERNATIONAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)—(Continued)

September 30, 2021

The following table provides a reconciliation of service revenues and segment income by reportable segment to consolidated results for the three and nine months ended September 30, 2021 and 2020 (in thousands):

The following table provides a reconciliation of service revenues and segment income by reportable segment to consolidated results for the three months ended March 31, 2022 and 2021 (in thousands):

Three Months Ended

September 30, Nine Months Ended

September 30,

2021 2020 2021 2020

Service revenues

Temporary and consultant staffing $ 1,054,701 $ 781,391 $ 2,922,257 $ 2,626,897

Permanent placement staffing 156,444 87,203 411,788 278,722

Risk consulting and internal audit services 501,421 321,303 1,357,482 899,295

Contract talent solutions $ 1,155,723 $ 889,275

Permanent placement talent solutions 186,782 111,703

472,329 397,402

$ 1,814,834 $ 1,398,380

Segment income

Temporary and consultant staffing $ 110,010 $ 43,779 $ 279,697 $ 165,933

Permanent placement staffing 31,030 10,128 79,264 20,791

Risk consulting and internal audit services 86,952 48,735 224,256 105,311

Contract talent solutions $ 133,246 $ 75,535

Permanent placement talent solutions 37,328 17,780

57,077 57,322

Combined segment income 227,651 150,637

4 unchanged sentences

Intersegment revenues

between temporary and consultant staffing segment and risk consulting and internal audit services segment were $ 173 million and $ 419 million for the three and nine months ended September 30, 2021, respectively, and $ 60 million and $ 148 million for the three months and nine months ended September 30, 2020, respectively.

Revenue and direct costs related to the intersegment activity are reflected in the risk consulting and internal audit segment, including the costs of candidate payroll, fringe benefits and incremental recruiter compensation.

between the contract talent solutions segment and Protiviti segment were $ 144.2 million and $ 103.8 million three months ended March 31, 2022 and 2021, respectively.

Revenue and direct costs related to the intersegment activity are reflected in the Protiviti segment, including the costs of candidate payroll, fringe benefits and incremental recruiter compensation.

ROBERT HALF INTERNATIONAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)—(Continued)

March 31, 2022

Note N— Subsequent Events

On October 28, 2021, the Company announced the following:

On May 3, 2022, the Company announced the following:

Quarterly dividend per share $ .43

Declaration date October 28, 2021

Record date November 24, 2021

Payment date December 15, 2021

Declaration date May 3, 2022

Record date May 25, 2022

Payment date June 15, 2022

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements